The electrification rate in India is expected to rise from 19% today to 32% by 2035, with the transport electrification rate playing a key role, according to the International Energy Agency (IEA)'s latest electrification special report.

In Southeast Asia, the rate could increase from 25% to 37%, the report said. Electric two- and three-wheelers and cars are now cheaper on average over their usual ownership period than internal combustion engine alternatives in these countries.

It also said global fuel-importing countries could cut energy import bills by over $400 billion by 2035 from 2025 levels if they speed up electrification. For India, lower imports could save nearly 30% of its 2025 import bill.

The report said the conflict in West Asia and shipping disruptions through the Strait of Hormuz have raised concerns among governments and consumers, especially in fuel-importing countries, about supply shortages and higher energy prices. During the crisis, several countries announced electrification policies. India launched a programme to procure and deploy 500,000 induction cooktops.

In addition, electric car sales in India rose by more than 115% in the four months from March to June 2026 compared to the same period last year, IEA said. EVs made up over 65% of three-wheeler sales in 2025.

India, where solar photovoltaic shares are rising fast and demand is increasingly concentrated in the evening and at night, smart charging, time-of-use tariffs and vehicle-to-grid systems can move demand to off-peak periods, improve grid use and strengthen the economic case for EVs.

The IEA said that China remains a major source of growth in air conditioning demand, while India and Southeast Asia's combined share of the global stock could rise from under 10% today to 20% by 2035. It said that as incomes and temperatures rise, AC uptake will grow, with about half of households having cooling access by 2035 and nearly 90% of new residential AC stock added in emerging market and developing economies.

The IEA said emerging market and developing economies saw higher electricity demand, with annual growth from 2015 to 2025 averaging around 5% in both India and Southeast Asia.

It rose at an average annual rate of more than 3% over the period, driven by strong growth in buildings and non-energy-intensive industry and led by China. China alone accounted for over 60% of the global increase in electricity demand over 10 years.